Recreational and Medical Marijuana in Washington State – Looking Back at 2014 and Ahead to 2015

Last year, 2014, will be remembered as the year that the recreational marijuana industry in Washington State started operations. Recreational marijuana is now being grown and processed at various licensed locations throughout Washington State, and it is available in licensed retail stores in many cities and counties. The transition has been gradual – many cities and some counties are still on the sidelines, and some have opted out entirely. See our map for a comprehensive picture, with links to the current local government zoning ordinances or other documents for details. The national trend is toward more expansive availability, as is evidenced by two more states (Oregon and Alaska) joining Washington and Colorado in the shift to a regulated marijuana market.

The legal ability of cities and counties to opt out – to prohibit recreational marijuana businesses – has so far been upheld. Five superior court decisions have now supported local government prohibitions on licensed marijuana businesses, citing the basic reasoning articulated in the attorney general opinion issued last January. So far there have been no appellate court decisions on the prohibition issue in this state. There will be continued litigation.

Early in 2014, many local governments were heatedly discussing whether to allow or prohibit recreational marijuana businesses, but, as far as I can tell, the past couple of months have been fairly quiet on this issue. Some jurisdictions that decided to allow state-licensed marijuana businesses are now amending their zoning ordinances, fine-tuning them to address local concerns.

Numerous marijuana-related bills were introduced in the state legislature in 2014, but none passed. It seems likely that there will be marijuana legislation passed in the 2015 session, and a few bills have already been “prefiled.” One major issue that should get addressed is medical cannabis (marijuana); it needs to be brought into a regulatory scheme similar to recreational marijuana, and the taxation issue needs to be addressed. Currently, recreational marijuana cannot compete price-wise with medical cannabis, which is largely unregulated and untaxed. This results in many individuals without a “medical need” purchasing less expensive marijuana for recreational use at medical cannabis dispensaries. This inconsistency in regulation and taxation must be addressed.

For an excellent discussion of the issues involving medical cannabis I recommend that you read Seattle city attorney Pete Holmes’ recent memo on this issue. If his recommendations, or something similar, are adopted by the legislature, there will be a massive change to the wide-open, unregulated medical cannabis market that is currently functioning in some areas of the state. During this “transitional” phase, many local government jurisdictions have been reluctant to fully enforce existing laws regarding medical cannabis, but I suspect that is going to change over the coming year or two. Medical cannabis growers and dispensers need to be aware of this impending change – the civil and criminal authority of the state will be focused on those who do not respond appropriately.

On the tax revenue front, the governor’s proposed budget for the coming biennium provides for a sharing of the excise tax revenue from recreational marijuana with those cities and counties that have licensed businesses operating within their borders. There will be much discussion of the proposed tax-sharing, and the amount.

Predicting the future is often futile, but I suspect we will see lots of changes to the marijuana industry over the coming year. The legislature will address some or all of the issues discussed above, though whether there will be any resolution remains to be seen, of course. And, sooner or later, Congress will finally remove marijuana from the list of Schedule 1 controlled substances – but probably not until rigorous scientific studies and drug trials show that some chemical substances in marijuana do, indeed, have legitimate medical uses.

We’ll do our best to keep you up-to-date through these periodic blog posts and through our detailed webpage, which examines many aspects of the development of our state’s regulated marijuana industry.

About Jim Doherty

Jim has over 24 years of experience researching and responding to varied legal questions at MRSC. He is the lead attorney consultant and has special expertise in transmission pipeline planning issues, as well as the issues surrounding medical and recreational marijuana.